Consumers are still seeking local products, but executives at one of Canada’s biggest grocers say the buy Canadian movement is starting to lose some steam.
“It’s decelerating somewhat,” Metro Inc. chief executive Eric La Flèche told analysts during a third-quarter earnings conference call on Wednesday.
“Consumers are still buying more Canadian, so we’re seeing more growth on Canadian product than non-Canadian product, but it has decelerated slightly.”
Earlier this year, trade disputes with the United States helped kick off the trend of shoppers favouring Canadian-made products, which pushed many grocers to increase their local offerings and promote domestic and local products with signs on their shelves.
Meanwhile, tariffs from the U.S. and Canada’s own counter-tariffs have continued to lead some food producers to request price increases from grocers including Metro.
La Flèche said tariffs have pushed prices higher for about 3,000 products.
“The introduced tariffs and counter tariffs are also a contributing factor to food inflation as we continue to receive price increase requests from our vendor partners,” he said.
After the counter-tariffs were imposed in March, some suppliers waited a bit but the price increases eventually rolled in, he said.
“Teams continue to negotiate to minimize the impact on consumers, and for now, the effect remains manageable.”
The grocer has also been on the lookout for suppliers in other countries to minimize costs, La Flèche said.
Metro Inc. reported a third-quarter profit of $323 million, up from $296.2 million in the same quarter last year. The grocery and drugstore retailer said its profit amounted to $1.48 per diluted share for the 16-week period ended July 5, up from $1.31 per diluted share a year ago.
Sales for the quarter totalled $6.87 billion, up from $6.65 billion in the same quarter last year.
Food same-store sales were up 1.9 per cent, while pharmacy same-store sales were up 5.5 per cent, with a 6.2 per cent increase in prescription drugs and a four per cent increase in front-store sales, primarily driven by over-the-counter products, cosmetics, and health and beauty.
During the call, La Flèche noted shoppers are continuing to try and keep a lid on their grocery bills.
“The search for value has been ongoing for over a couple of years now or more, so it’s the same trends,” he said.
“People are searching for value. Promotional levels are high. Private label sales are high, so we’re seeing pretty much the same picture on the consumer side.”
On an adjusted basis, Metro says it earned $1.52 per diluted share in its latest quarter, up from an adjusted profit of $1.35 per diluted share in the same quarter last year.
RBC analyst Irene Nattel said in a note the results were “solid and consistent” with expectations.
Metro’s stock price however dropped seven per cent Wednesday to close at $98.58 on the Toronto Stock Exchange.
Nattel said the decline likely reflects high expectations among shareholders, though she noted Metro’s track record “of delivering visible, predictable, consistent results that underpins valuation, and Q3 results continue that trend.”
She said Metro’s results, along with recent earnings from Loblaw Cos. Ltd., reinforce her investment thesis on the grocers, as “cash-strapped consumers moderate food away from home, and focus on value in everyday household purchases.”
Nattel said Metro’s outlook shows the company is focusing on realizing efficiencies from its significant investments in modernizing its supply chain in recent years.
Metro has invested nearly $1 billion in modernizing its supply chains in Quebec and Ontario.
This report by The Canadian Press was first published Aug. 13, 2025.
Companies in this story: (TSX: MRU)
